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Finding success in challenging times

Industry networks can be one of the strongest tools available when it comes to difficult business decisions around change. 

Industry networks can be one of the strongest tools available when it comes to seeking advice and they can be doubly relevant when it comes to difficult business decisions around change. 

One can’t-miss way collision shop owners can find some potentially great business ideas is to ask other shop owners about changes they’ve made recently. Understanding what prompted the changes, how they were implemented, and what the outcome has been can help inspire changes within your own shop.

Here’s a round-up of the changes some collision business operators in the United States have made in past year or two.

Scott Benavidez, a shop owner in the southwestern state of New Mexico, says he’s given his technicians in both the body and paint shop access to his estimating system so they can take and upload in-process photos.

“That has really been helping me because there’s always that one picture you forgot to take, or the estimators have to stop what they’re doing to go back out for photos,” Benavidez says. “Getting the technicians involved in the supplemental process has really helped streamline things. We have proof of a lot more things, we’re getting paid for a lot more things, and it speeds up the supplement a little bit.”

California shop owner Tiffany Silva points to staffing changes she’s made at her 25-employee shop that are enabling her to better “work on my business, not in it.” 

She promoted an existing employee to assist the shop’s production manager and added a third person to that team in a role she’s calling repair planner.

“She’s helping with [locating] and emailing OEM repair information to the techs and making sure everybody has everything they need to get right on that job, and helping with scheduling,” Silva says of the new hire. Despite not knowing anything about the industry, Silva says the new employee is “into technology and she can figure out anything we need.”

“She’s doing all our pre- and post-repair scanning, and arranging the calibrations done by an outside company,” Silva says.

The employee promoted to assistant production manager had worked in both the paint and body departments at various times while at the shop, “so he’s respected by the entire team,” she says.

“They are tag-teaming production, and they know they can’t both be on vacation at the same time,” Silva says. 

“So, I always have a back-up person. I like to [quality control check] every vehicle before it leaves my shop, but that’s not always possible. So having a production team gives us someone based behind the computer, someone out on the shop floor directing traffic, and someone who can always QC vehicles for me. It’s been working out great.”

Dropping DRPs, adding co-pays

Wisconsin shop owner Sue Black says she has eliminated some insurance company direct repair programs (DRPs) and negotiated new labour rates with some insurers. 

“We have been able to work on that and really pay our technicians what they deserve to be paid so that we can retain them and also train them and keep them qualified to repair the vehicles coming to us,” Black says.

She says the shop also has started to sometimes charge customer co-pays.

“We’ve just explained to them: This is what your insurance company is willing to pay for the repair of your vehicle, but here is the research that says this is what needs to be done on your vehicle, and we want to make sure that your vehicle is getting back on the road properly, and in order to do that, you might have to pay some out-of-pocket expense,” Black says. “And because we sit down and really explain the situation to our customers, a lot of them are willing to pay extra to have their vehicle repaired the correct way.”

Personnel changes, adding transparency

Tom Ricci, a shop owner in the state Massachusetts, says he’s been pursuing more non-insurance commercial work.

“Because we’ve got a couple accounts now that we’ve groomed in the last couple of years to pay a sizably higher labour rate,” Ricci says.

Like Silva, he’s also made some management personnel changes that have been “very fruitful for morale and production.” He came to realise his production manager “wanted to play fireman, but we didn’t want fires,” so he promoted another person to that position. One of the shop’s three estimators now oversees that team and works with the production manager.

“So that removed me a lot more from the day-to-day,” Ricci says. “But it also increased production because the two people have the right attitude as co-managers.”

Minnesota shop owner Will Latuff says his company is another one that has “parted ways with several DRPs.”

“We basically made some decisions on what is our fight and what’s not our fight,” Latuff says. “Keeping the consumer more involved and more updated, and peeling things back so they can see what goes on when a supplement is submitted, really lets them know how hard you’re working for them, to get them taken care of.”

The transparency helps keep customers up to date, he says.

“We give them copies of what was submitted [to the insurer], letting them know the deficiencies when it comes back, letting them know what their potential out-of-pocket could be,” Latuff says. “They see we submit a repair plan that’s vastly different than the photo estimate the insurance company created. By the time we get down to the final bill and the gap is reduced substantially, you’re the hero. They’re happy for everything that you did throughout the repair.”

Better triaging of jobs

Andrew Batenhorst, manager of Pacific BMW Collision Center in Glendale, California, says parts delays can be significant for BMW parts out of Germany.

“Anything that’s coming from that side of the world is four to six weeks away in some cases,” Batenhorst says.

“So, what’s been really helpful for us is being very aggressive with how we triage jobs, deciding what cars are going to come into the shop, and which ones we will keep on the road as long as possible. So, on certain job sizes, we can do a quick inspection on them, maybe loosen up the bumper or use an inspection camera to check out possible hidden damage, and we can get a repair plan that’s maybe 85 per cent to 95 per cent of the way through. We can get the parts pre-ordered and arrived, and we can cut the repair time down immensely because we’ve maybe also gone through a supplement approval at that point, too.”

He says one hurdle with this is the amount of space involved in storing more pre-ordered parts than they have in the past.

“So we’ve adapted our logistics to be able to handle it, and it’s worked really well,” he says. “We’ve had a lot of positive feedback from clients. If the car’s just cosmetically damaged, then they’re typically okay with us doing that for them. Now, if it’s not drivable, we’ll have to go ahead and get the car in. But for probably 40 per cent to 50 per cent of our work, we can minimise the downtime here, and it does pay off in the long run.”

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